FTS International, Inc. Announces Launch of Cash Offers for Its 6.250% Senior Secured Notes Due 2022 and Term Loan Due 2021 of $50 Million in the Aggregate

FORT WORTH, Texas--()--FTS International, Inc. (“FTS” or the “Company”) announced today the commencement of a cash offer to reduce the level of the Company’s indebtedness. The Company will offer to purchase (the “Tender Offer”) its outstanding 6.250% Senior Secured Notes due 2022 (the “Notes”) and concurrently offer to repay (the “Term Loan Offer” and, together with the Tender Offer, the “Offers”) its Term Loan due 2021 (the “Term Loan” and, together with the Notes, the “Debt”). The aggregate maximum amount of cash that the Company will use to purchase Notes and/or repay its Term Loan in the Offers is $50,000,000.

The Tender Offer is being made on the terms and subject to the conditions set forth in the Offer to Purchase dated June 6, 2016 (the “Offer to Purchase”) and the related Letter of Transmittal (the “Letter of Transmittal”), and the Term Loan Offer is being made upon terms substantially similar to the Tender Offer, pursuant to the Auction Notice and the Alternate Auction Procedures (the “Term Loan Offer Documents”).

In the Offers, the price will be determined in accordance with a modified Dutch auction procedure on the terms and conditions set forth in the Offer to Purchase and the Term Loan Offer Documents. FTS expects to purchase or repay the Debt in the Offers using cash on hand.

Information relating to the Debt and the Offers is listed in the table below.

       
Debt   CUSIP
Number
  Outstanding
Principal
Amount
 

Early
Participation
Payment(1)

 

Total
Consideration
(Acceptable Bid
Price Range)(1)(2)

 
6.250% Senior Notes due 2022 30283W AB0 $468,000,000 $50.00 $300.00 – $400.00
Term Loan Due 2021 30284D AB1 $480,000,000 $50.00 $300.00 – $400.00
 

(1) Per $1,000 principal amount of Debt that is accepted for purchase.

(2) Includes the Early Participation Payment

Holders that validly tender Notes or lenders that submit a Lender Participation Notice (and do not validly withdraw, in the case of Notes) pursuant to the Offers at or prior to 5:00 p.m., New York City time, on June 17, 2016 (as may be extended, the “Early Participation Deadline”), will receive the “Total Consideration,” including an early participation payment of $50.00 per $1,000 principal amount of Debt (the “Early Participation Payment”) tendered in the Offers. Holders that validly tender Notes or lenders that submit a Lender Participation Notice for the Term Loan after the Early Participation Deadline will not be eligible to receive the Early Participation Payment.

The Offers are scheduled to expire at 11:59 p.m., New York City time, on July 1, 2016 (as may be extended, the “Expiration Time”). Tendered Notes may be withdrawn at any time at or prior to 5:00 p.m., New York City time, on June 17, 2016 (as may be extended, the “Withdrawal Deadline”), but not thereafter. Holders of Notes that tender their Notes after the Withdrawal Deadline, but at or prior to the Expiration Time for the Offers, may not withdraw their Notes tendered pursuant to the Offers. Lenders that validly submit a Lender Participation Notice for the Term Loan Offer may not validly withdraw such notice at any time.

The Total Consideration for each $1,000 principal amount of Debt validly tendered (and not validly withdrawn, in the case of Notes) at or prior to the Early Participation Deadline and accepted for purchase or repayment by the Company will be equal to the sum of: (1) the “Base Price” and (2) the “Clearing Premium,” which Clearing Premium will be determined pursuant to an independent modified Dutch Auction by consideration of the “bid price” specified by each holder or lender that tenders or submits Debt pursuant to the Offers. The bid price represents the minimum consideration a holder or lender is willing to receive for that Debt and must fall within the acceptable bid price range specified in the table above.

The Tender Offer Consideration for each $1,000 principal amount of Debt validly tendered after the Early Participation Deadline and at or prior to the Expiration Time and accepted for purchase or repayment by us will consist of the Total Consideration less the Early Participation Payment.

The Clearing Premium will be the lowest single premium at which FTS will be able to spend the entire $50 million by accepting all Debt validly tendered (and not validly withdrawn, in the case of Notes) with bid premiums (the amount by which each bid price exceeds the Base Price) equal to or lower than the Clearing Premium. If the aggregate amount of Debt validly tendered (and not validly withdrawn, in the case of Notes) at or below the Clearing Premium would cause the Company to spend more than the maximum payment amount for the Offers, then holders or lenders of the Debt tendered or submitted at the Clearing Premium will be subject to proration as described in the Offer to Purchase and the Term Loan Offer Documents.

FTS will pay accrued and unpaid interest on all Debt tendered or repaid and accepted in the Offers from the last interest payment date to, but not including, the date on which the Debt is purchased by the Company pursuant to the Offers.

The Offers are conditioned upon the satisfaction or waiver of certain conditions as described in the Offer to Purchase and the Term Loan Offer Documents.

FTS has retained Wells Fargo Securities, LLC, who is acting as lead dealer manager, and Lazard Frères & Co. LLC, who is acting as dealer manager, to serve as dealer managers for the Tender Offer and as auction managers for the Term Loan Offer. FTS has appointed Global Bondholder Services Corporation (“GBS”) to serve as the depositary and information agent for the Tender Offer.

For additional information regarding the terms of the Offers, please contact Wells Fargo Securities, LLC at (866) 309-6316 (toll free) or (704) 410-4760 (collect) or Lazard Frères & Co. LLC at (877) 364-0850 (toll free) or (212) 632-1979 (collect). Requests for documents and questions regarding the Tender Offer should be directed to GBS at (212) 430-3774 (banks and brokers) or (866) 924-2200 (all others).

None of FTS, its members, directors, managers or officers, the dealer managers and solicitation agent, GBS or the trustee or administrative agent for the Debt, or any of their respective affiliates, is making any recommendation as to whether holders should tender any Notes or submit a Lender Participation Notice with respect to any Term Loan in response to the Offers. Holders and lenders must make their own decision as to whether to tender any of their Notes or whether to submit a Lender Participation Notice and, if so, the principal amount of Notes to tender or Term Loan to include in its Lender Participation Notice.

This announcement is for informational purposes only and does not constitute an offer to buy or the solicitation of an offer to sell securities. The Offers are being made solely by means of the Offer to Purchase, the related Letter of Transmittal, and the Term Loan Offer Documents. In those jurisdictions where the securities, blue sky or other laws require any tender offer to be made by a licensed broker or dealer, the Offers will be deemed to be made on behalf of FTS by the dealer managers or one or more registered brokers or dealers licensed under the laws of such jurisdictions.

About FTS

FTS International is the largest private well completion service company in North America. The company provides well completion services, including pressure pumping, wireline and reservoir optimization technologies. FTS’s products and services enhance recovery rates from oil and gas wells, primarily in unconventional plays.

Contacts

FTS International, Inc.
Investor
Lance Turner, CFO, 817-862-2000
Investors@ftsi.com
or
Media
Karen Testa, 817-339-2608
karen.testa@ftsi.com

Release Summary

FORT WORTH, TEXAS, June 6, 2016 — FTS International, Inc. announced today the commencement of a cash offer to reduce the level of the Company’s indebtedness.

Contacts

FTS International, Inc.
Investor
Lance Turner, CFO, 817-862-2000
Investors@ftsi.com
or
Media
Karen Testa, 817-339-2608
karen.testa@ftsi.com